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When financing a home purchase, there are several factors that affect the cost of the loan and whether you have a seamless borrowing experience. Interest rate plays the biggest role in what you will ultimately owe, but it’s not the end all, be all. And in some cases, a rate that appears to be great could come with expensive or stressful surprises. Here’s what you should know:

Fees and APR

Origination fees. Application fees. Administration fees. Pre-payment penalties. These are just some of the additional costs certain lenders build into the amount you borrow. And they can end up costing you hundreds or even thousands more than you thought. This is why, instead of looking at the simple interest rate quoted, you should focus on the Annual Percentage Rate, or APR.

The APR is the interest rate plus the costs of those additional fees, stretched out for a whole year. It fluctuates based on time and how you repay the loan. So just a little difference in APR can make a big difference in what the loan ends up costing you over the long haul. Ask for a breakdown of all fees and rates to help you compare loans from one lender to another.

Tip: choose a lender that won’t charge pre-payment penalties. You shouldn’t be penalized for saving yourself money by paying off a loan early.

Mortgages Come in Many Shapes and Sizes (and Costs!)

Shopping for a home mortgage is just as important as shopping for the home itself. And loan terms make all the difference here. There are so many home loan options available – everything from a standard 30-year fixed-rate loan to adjustable-rate mortgages that start at a lower rate (and thus, lower payment), but then adjust up by varying amounts after a certain number of years.

The home loan you choose should be tailored to your unique situation. That’s why working with a knowledgeable, trustworthy lender is so crucial. Not only should they explain your options for loan types and terms, but also how fees and closing costs will ultimately affect what you pay. While these charges can vary from lender to lender, comparing mortgage options is a bit easier thanks to standardized documents that all lenders must provide potential borrowers.

Choose Your Lender Wisely

Typically, borrowers are most focused on the lender who will give them the best loan pricing. But if the company behind that great price doesn’t have the great service to match, think twice. With a home loan, that company could be servicing your loan for the next 30 years. Do you really want to deal with the run around on something so important? It’s important to work with a lender that understands the value of your time and will work diligently to make things happen.